Financial experts are constantly saying that you need $1 million or more in retirement savings to enjoy a comfortable retirement. If the average retiree can expect to live somewhere in the ballpark of 20 to 30 more years after they stop working, that means you’ll need to keep your expenses as low as possible.
That’s increasingly difficult in these high inflationary days. However, it is possible, depending on the state in which you live.
To find the states where you can retire for less than $50,000 per year, GOBankingRates analyzed each state to find the average cost of living for a retired resident at age 65 or older. Most of these 18 states are in the South and Midwest, with the exception of Pennsylvania.
Read on to find out where your money will go the furthest in retirement.
Pennsylvania
- Percent of population age 65+: 18.7%
- Total monthly cost of living: $4,133
- Total annual cost of living: $49,596
Pennsylvania retirees squeak by under $50,000 in retirement costs. Here, transportation costs of $420 per month are the highest on this list, as is the $378 in utilities.
South Dakota
- Percent of population age 65+: 17.3%
- Total monthly cost of living: $4,124
- Total annual cost of living: $49,489
South Dakotans pay a not-so-small $308 per month for utilities and another $387 in transportation costs.
Georgia
- Percent of population age 65+: 14.4%
- Total monthly cost of living: $4,118
- Total annual cost of living: $49,421
Retirees in Georgia are putting the bulk of their money toward housing, which is around $729 per month, and healthcare, which comes in around $627 per month.
Michigan
- Percent of population age 65+: 17.8%
- Total monthly cost of living: $3,977
- Total annual cost of living: $47,730
In Michigan, 17.8% of the population are age 65 or older. Here, you can retire for under $48,000, with the biggest monthly expenditures being healthcare, at $584 per month, and housing, at around $719 per month.
Nebraska
- Percent of population age 65+: 16.2%
- Total monthly cost of living: $3,969
- Total annual cost of living: $47,627
Nebraskan retirees are paying close to $4,000 per month in total monthly expenditures, but it still comes in under $48,000 per year.
Mississippi
- Percent of population age 65+: 16.5%
- Total monthly cost of living: $3,942
- Total annual cost of living: $47,304
Groceries for retirees in Mississippi will cost around $400 per month, while utilities come in at around $303.
Iowa
- Percent of population age 65+: 17.6%
- Total monthly cost of living: $3,910
- Total annual cost of living: $46,925
In Iowa, retirees can expect to spend around $622 per month in healthcare costs and nearly $400 in transportation costs.
Illinois
- Percent of population age 65+: 16.2%
- Total monthly cost of living: $3,879
- Total annual cost of living: $46,542
In Illinois, retirees will pay a wee bit under $600 for healthcare each month but almost $750 per month in rent.
Ohio
- Percent of population age 65+: 17.6%
- Total monthly cost of living: $3,869
- Total annual cost of living: $46,433
Ohio retirees are paying $350 per month in utilities alone, as well as another $399 in transportation.
Louisiana
- Percent of population age 65+: 16.0%
- Total monthly cost of living: $3,855
- Total annual cost of living: $46,259
Retirees in Louisiana are paying the second-highest average monthly rent on this list, at $761 per month.
Kentucky
- Percent of population age 65+: 16.8%
- Total monthly cost of living: $3,853
- Total annual cost of living: $46,231
Retirees in Kentucky are paying the most in groceries of any state on this list, at $417 per month, and the most in miscellaneous costs, around $74 per month.
Indiana
- Percent of population age 65+: 16.2%
- Total monthly cost of living: $3,849
- Total annual cost of living: $46,190
Retirees in Indiana put a large chunk of their monthly money toward housing costs of $707 and another big chunk to healthcare, at around $603 per month.
Alabama
- Percent of population age 65+: 17.3%
- Total monthly cost of living: $3,814
- Total annual cost of living: $45,774
Groceries in Alabama, which are around $395 per month, aren’t much more than utilities, which are $376.
Missouri
- Percent of population age 65+: 17.3%
- Total monthly cost of living: $3,729
- Total annual cost of living: $44,751
Missouri retirees will pay $718 toward their housing and $562 in healthcare.
Arkansas
- Percent of population age 65+: 17.2%
- Total monthly cost of living: $3,655
- Total annual cost of living: $43,865
Arkansas retirees will pay around $547 in healthcare per month and about $392 in grocery costs.
Oklahoma
- Percent of population age 65+: 15.9%
- Total monthly cost of living: $3,634
- Total annual cost of living: $43,605
Oklahoma retirees pay more in transportation per month, $368, than they do in utilities, which are around $346 per month.
West Virginia
- Percent of population age 65+: 20.4%
- Total monthly cost of living: $3,552
- Total annual cost of living: $42,621
West Virginia has the highest percentage of adults ages 65 and older on this list, with over 20%.
Kansas
- Percent of population age 65+: 16.3%
- Total monthly cost of living: $3,492
- Total annual cost of living: $41,898
In Kansas, other than rent, retirees are spending significantly on healthcare, around $606 per month, and $400 on groceries.
Methodology: For this study, GOBankingRates analyzed each state to find the average cost of living for a retired resident. First GOBankingRates found the cost of living indexes as sourced from the Missouri Economic and Research Information Center. Using the average expenditure costs for retired residents, as sourced from the Bureau of Labor Statistics Consumer Expenditure Survey for retired residents. The average rental cost was sourced from Zillow Observed Rental Index. The average rent cost was added to the average expenditure cost to find the total monthly and annual cost of living. The total population and population aged 65 and over were found from the US Census American Community Survey. The states were sorted to show the cheapest to the most expensive. All data was collected on and is up to date as of May 10, 2024.